Court Enters Final Judgment Against Shirmila Doddi For Insider Trading

The Securities and Exchange Commission (SEC) announced that on January 20, 2016, the Court for the District of Massachusetts entered a final judgment against defendant Shirmila Doddi, permanently enjoining her from future violations of Section 10(b) and Rule 10b-5. The final judgment also orders further proceedings for the purposes of determining the appropriate amount of disgorgement, prejudgment interest thereon, and civil penalties. Doddi consented to the final judgment.

In its insider trading complaint, the SEC alleged that, in 2011, Vlad Spivak, then a resident of Medford, Massachusetts, traded in the securities of American Dental Partners, Inc. (“ADPI”) on the basis of material nonpublic information that he received from his romantic partner, Shirmila Doddi. The complaint alleged that Doddi, who was then a financial analyst at a commercial bank, provided Spivak with material, nonpublic information that she had obtained in the course of her employment regarding an impending acquisition of ADPI by a private equity firm. The insider trading complaint further alleged that following the public announcement of the acquisition, the price of ADPI stock rose by seventy-nine percent and Spivak, who had traded in accounts held in his name and in the name of his mother, realized profits of over $222,000. Doddi did not trade in ADPI stock.

The SEC’s insider trading complaint charged Spivak and Doddi with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, which are antifraud provisions of the federal securities laws. The litigation against Spivak is ongoing.